WASHINGTON — Hours after landing a massive tax windfall, AT&T, Comcast, Wells Fargo and Boeing — among other major companies — announced plans Wednesday to share a fraction of their bounty with workers.
The moves pleased President Donald Trump, who has claimed his $1.5 trillion in tax cuts that largely favor the wealthy and businesses would ultimately help the middle class.
But Democratic lawmakers and corporate watchdogs say the move is a public-relations stunt that pales in comparison to the profits the companies’ shareholders and executives will reap because of the lower tax rates.
Trump was quick to celebrate an announcement by Dallas-based AT&T that it would pay a $1,000 bonus to 200,000 workers once the tax bill passed Wednesday is signed into law. His praise came as the Justice Department is suing to block a proposed $85 billion merger between the communications company and Time Warner, a deal Trump has objected to as “not good for the country.”
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Matthew Gardner, a senior fellow at the liberal Institute on Taxation and Economic Policy, said companies have been sitting on large cash holdings for years that easily could have gone to workers before the tax cuts. Chicago-based Boeing, for example, had $8.8 billion at the end of 2016.
“If these companies had wanted to make these investments in their workforce, they could have done it before now,” Gardner said. “They’re trying to make an unpopular tax bill a little less unpopular.”
The bill has polled poorly with voters, in part, because it would appear to help major companies and concentrate much of its tax cuts with the top 5 percent of earners.
The possibility of money going to workers helps to insulate Republicans against a possible backlash, although, so far, the bonuses are a far cry from the $4,000 in additional income each year that White House economists said would go to an average family because of the corporate rate cuts.
In addition to these companies, Cincinnati-based Fifth Third Bancorp said it will pay $1,000 bonuses to more than 13,500 employees, as well as raise the minimum wage for 3,000 of its workers to $15 an hour.